Cyprus Property Forum for Buyers, Sellers & Investors

Hi Nigel
Can you help with my confusion. We have just purchased our Deeds and are under the impression we can reclaim the IPT which of course we have been paying to the Developer. Do you know how this is calculated, and by whom. We are told that the criteria for repayment of any IPT is if you have overpaid. The purchase price of our flat would have fallen into the exempt category if we had bought it as a single unit, but of course the developer would have been charged at the value of the entire block which is how we understand it. Logic says that if we would not have been paying IPT as owners of a single unit, then we will have overpaid the entire amount. However, having lived here for a while we know its probably not that simple. Having asked our solicitor here about the amount we can reclaim, the answer was "we don't know, but it won't be anything like you have paid". Somewhere in the back of our minds we can recall someone saying that you can only reclaim a certain number of years, but the memory is a bit vague.

Hope you can help.
Confused of Papho

Hi 'Confused of Paphos' and welcome to the forum,

The developer will have been paying IPT on the whole development. The way that his liability is calculated is on the whole of his portfolio - and this will include the development where you have bought and other developments registered in his name.

Once he starts building, he declares the amount of expense he has put into the land each year. Let us say the land on which he is building has a 1980 value of €50,000 and he spends €1,000,000 on a site in one year. This additional value will be assigned a 1980 value by the Inland Revenue Department (let’s say that's €150,000) and they will add this to the 1980 value of the land giving a total of €200,000. The Inland Revenue will then calculate the developer's IPT liability based on this amount.

I cannot say how much the developer will have paid, but he should have provided you with the necessary paperwork that will enable you to reclaim any overpayments.

If you want to know how to make a claim, you can find the information on my website at http://www.cyprus-property-buyers.com/law/tax.htm - half way down the page under the heading "Reclaiming Immovable Property Tax from the Inland Revenue".

Regards,

Thank you Nigel.